Walmart Compromised Gift Cards California Class Action

How would you feel if you spent $1,000 on prepaid cards, only to find out that their value had already been spent? How would you feel if this fraud was known, but no one had done anything to stop it? The complaint for this class action alleges that Walmart, Inc., Green Dot Corporation, and Green Dot Bank are aware of the scam practiced with these prepaid cards, but continue to offer them as they are.

The class for this action is all persons in California who bought Green Dot Visa prepaid cards from Walmart with balances of more than $50.

On February 27, 2019, plaintiff Guillermo Espinoza bought two prepaid Green Dot cards at a Walmart in San Marcos, California. He paid $500 for each and intended to use them to pay his rent.

The next day, he tried to use the cards, but they were rejected as having insufficient funds. A checker at Walmart told him to wait a few days, because sometimes it takes time for the cards to activate.

On March 1, he called to check on the cards and was told that both cards had been used, for nearly all of their value.

After that, Espinoza went back and forth between Walmart and Green Dot. Each company ultimately told him that the other company was responsible for the loss.

However, in the process, he learned that he had most likely been the victim of a scam that had been operated more than once with the cards. The complaint claims that a floor manager in the Hemet store told him that “as soon as they are activated a hacker can liquidate the gift cards.” Also, it claims, a Green Dot representative said individuals sometimes obtain the card information, then periodically try to make $1 charges until they find that the card has been activated; then they spend the remainder of the card amount. However, the representative told him that Green Dot couldn’t do anything about it.

On the back of the gift card package is a window to the back of the card. The tab there says
“Cashier: Remove tab to scan barcode” and “If tab is tampered with, do not sell.” However, since this warning is printed on the tab, if the tab is removed, the warning goes with it. Although there is another warning printed on the front of the package, the complaint says it can be easily overlooked. The complaint alleges that scammers remove the tab, take the information, and then can use it to drain the value of the gift card as soon as it is activated.

According to the complaint, virtually all other gift card issuers pack their cards in hard plastic packaging that does not allow such tampering.

The complaint alleges that the companies know about the scam and the tampering yet still continue to sell the cards without warnings and without doing anything to remedy the situation. Customers lose up to $500 if they do not discover the fraud and report it within two business days.

The complaint brings suit under California state laws.

Article Type:
Topic: Consumer

Most Recent Case Event

Walmart Compromised Gift Cards California Complaint

October 11, 2019

How would you feel if you spent $1,000 on prepaid cards, only to find out that their value had already been spent? How would you feel if this fraud was known, but no one had done anything to stop it? The complaint for this class action alleges that Walmart, Inc., Green Dot Corporation, and Green Dot Bank are aware of the scam practiced with these prepaid cards, but continue to offer them as they are.

Walmart Compromised Gift Cards California Complaint

Case Event History

Walmart Compromised Gift Cards California Complaint

October 11, 2019

How would you feel if you spent $1,000 on prepaid cards, only to find out that their value had already been spent? How would you feel if this fraud was known, but no one had done anything to stop it? The complaint for this class action alleges that Walmart, Inc., Green Dot Corporation, and Green Dot Bank are aware of the scam practiced with these prepaid cards, but continue to offer them as they are.

Walmart Compromised Gift Cards California Complaint
Tags: Gift Cards, Loss of credits or gift card benefits, Unfair Business Practices